The importance of pricing correctly at market value.
A common question home buyers ask is, "how long has this home been on the market?"
Though the question may sound innocent, the answer can have serious consequences for the sale of your property.
When a seller first lists their property, there's no denying they are in the driver's seat. A new listing creates a flurry of interest as buyers scramble to be the first to view it--and potentially make an offer. With each passing day, however, interest wanes and sellers quickly learn that "days on market" dictates who holds the cards.
As time passes, potential buyers become more suspicious of why the property hasn't yet sold ... leading them to wonder if there is something other buyers know that they don't.
And while issues with the home itself may sometimes be the reason for it not selling, it usually comes down to overpricing.
To keep your days on market short, it's important to price your property competitively from the outset and do everything you can to promote your property during its first two weeks on the market.
Why it is important to use a professional REALTORĀ® to sell your property
While it's true that the internet has made shopping more convenient for consumers, it has done little to replace the true value of using a real estate agent to sell your home.
Top benefits of using a real estate agent to list your property include:
Pricing
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It's a REALTOR's job to understand the market better than the public. To do this, they use many resources that most people don't have access to. These tools give REALTORS valuable insight into what the market is doing and how to price your home to sell quickly for top dollar.
Presentation
REALTORS are emotionally detached from the properties they sell and can objectively determine which features of your home to highlight. They also have experience in staging a home to give the best first impression to the highest number of potential buyers.
Marketing
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There are several marketing channels to consider when putting your home up for sale. A REALTOR will have professional contacts and an established advertising system in place to quickly get your property in front of potential buyers.
Higher offer
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Real estate agents know how to spot and follow up with a serious buyer. As a skilled negotiator, they know what to say--and what not to say--to get you the best possible offer.
Closing
Selling your home requires many time-sensitive documents to be completed. A real estate agent has the expertise to know exactly what should be included in the paperwork as well as the knowledge to fill it out correctly. In addition, a REALTOR knows all the minor details
An explanation and overview of this market analysis.
This Comparative Market Analysis will help determine the correct list price of your home. Ultimately, the correct list price is the highest possible price the market will bear.
This market analysis is divided into three categories:
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Comparable homes that are currently for sale
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Comparable homes that were recently sold
Comparable homes that failed to sell
Looking at similar homes currently for sale, we can assess the alternatives available to a serious buyer. We can also be sure we are not underpricing your home.
Looking at similar homes sold in the past few months, we can see a clear picture of how the market has valued homes comparable to yours. Banks and other lending institutions also analyze these sales to determine how much they can lend to qualified buyers.
Looking at similar homes that failed to sell, we can avoid pricing at a level that would not attract buyers.
This Comparative Market Analysis has been carefully prepared by analyzing homes similar to yours. The aim of this market analysis is to achieve the highest sale price for your home in a reasonably short period of time.
Effects of Overpricing
The importance of pricing correctly at market value.
Pricing your property too high all but guarantees it will take longer to sell--sometimes much longer. Instead of selling your property in just a few weeks, you could have to go through months of showings and open houses.
Even worse: statistics show that the longer a property is on the market, the less it sells for in the end. In fact, it will usually sell for less than what it would have fetched with a more realistic starting price.
The importance of pricing correctly at market value.
This graph illustrates the importance of pricing correctly. The centerline represents the true market value of a property. As you move above this market value, you attract far fewer prospective buyers, greatly reducing your chances of a sale. Conversely, as you move below market value, you attract a much larger number of potential buyers.
Setting the Price
The importance of pricing correctly at market value.
In a perfect world, the sale price of your property would be enough to achieve whatever financial goals you have in mind. In reality, the value of your property is determined exclusively by the amount buyers are willing to pay.
Often the hardest part of pricing your home is disregarding your emotional attachment. Remember that buyers are only interested in the bricks and mortar of the property--and the price you choose to list it at. To avoid the pitfalls of pricing it incorrectly, here are a few important questions to consider.
What are the prices of comparable properties in your area?
A Comparative Market Analysis (CMA) gathers information about similar homes for sale in your area, both past and present. Based on these comparable properties, the CMA provides you with a true estimate of what your home may be worth.
How fast do you want your property to sell?
Whether you need to make a quick sale or have time to wait, the initial listing price directly affects how fast your property will sell. Remember: a high list price will not generate as much interest and may eventually sell for less than an initial list price that is more competitive.
Is it a buyer's market, a seller's market, or balanced?
Are home prices in your area trending up, down, or leveling off? In a buyer's market, home inventories are high, increasing competition between sellers and reducing prices. In a seller's market, low inventories increase prices and put the homeowner in the driver's seat. In a market where supply and demand are evenly balanced, stable prices make choosing a list price easier. Regardless of the market's direction, you should consider a list price that will attract multiple offers and give you the best chance of selling your property
The importance of pricing correctly at market value.
Overpricing your house in the belief you can reduce the price later is a strategy that can backfire badly.
By the time you reduce your price, the initial surge of interest in your property may have passed. Also, if the price is lowered, buyers may wonder if there's something wrong with the property that kept other buyers away.
To avoid selling your property below market value and wasting valuable time, be careful not to overprice your home.
Today, most tech-savvy buyers use the internet to find properties they want to view. Still, an effective advertising campaign will source buyer prospects from a mix of traditional and online marketing channels. The chart below illustrates where most buyer leads come from.
Note that "Internet" is a broad category that includes diverse sources such as:
ā¢ A website about your property
ā¢ Social media
ā¢ Real estate search engines
ā¢ Real estate apps
ā¢ Online videos about your property
map showing the subject and comparable properties
A map showing the subject and comparable properties
Finley
Pricing Recommendation
Setting the right price is critical to a successful sale.
General Facts About Pricing
There are many things we can do to help ensure the successful sale of your home--such as sprucing up its appearance and marketing it aggressively--but the single most important thing is choosing the right price.
The best, most reliable way of choosing the right list price for your home is by comparing it to similar properties in the neighborhood. How much are comparable properties currently listed for? How much did comparable properties recently sell for? How are these properties different than yours? Are prices rising or falling? These questions will guide us to the best possible list price for your home: a price that is as high as possible but low enough to generate interest and lead to a quick sale.
Market Statistics
Prices are adjusted for property differences, rounded to the nearest $100.
Based on the style, size, uniqueness and premium location and positioning of your home, we would suggest a list price of 1,839,900 - 1,859,900. This is contingent on timing of list and preparation of the home.
Multiple Representation - Collateral agreement in place
Total commission = 4%
Buyer is generated from one of my team members, and they bring a successful ļ¬rm oļ¬er
Contract Period
120-day listing
Our guarantee to you
Our Guarantee to you as your real estate team of professionals - We are committed to working with you to develop a complete, transparent service plan that addresses your unique needs throughout the entire listing and sale process. As part of that plan, we guarantee to provide you with our undivided loyalty while always protecting your best interests.
We are bound by a strict code of ethics, promising to exercise the skilled judgment you would expect from a real estate professional We understand that selling your home is one of the most emotional and ļ¬nancially important decisions you will make. We pledge to fulļ¬ll every commitment in our service plan and will strive to exceed your best expectations.
If, for any reason, you feel we do not act according to the agreed-upon activities in the plan, we can discuss revisions to the plan.
